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Churn and burn

Sylvia Pennington

Tanaka Mwatse (left) and Trent Sacilotto work out at 2am. Photo: Janie Barrett

Long-term contracts used to mean gym members were loyal by default but the rise of 24-hour openings, increased outdoor options and unimpressive service have made facility-hopping - or "churn" - the norm for many fitness fans.

For some, the decision to move is geographic – a change of workplace or address puts them beyond easy distance – while others say a club that focuses more on attracting than retaining customers makes it easy to walk.

Scott Leslie, an accountant, is in the latter camp. An off-and-on gym-goer for five years, he says his present fitness centre, his third in that time, has over-selling and under-delivering down to a fine art.

"The membership was worth the money because they had a 50-metre swimming pool as part of the package," Leslie says.

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"They closed the pool about four months ago to have it refurbished and when I asked if they would consider dropping the fees they said they wouldn't but if I wanted to cancel my membership I could."

The gym also has old equipment that is due for replacement – but in no particular hurry.

"The other day I went in to do a session on what is quite an old, rusty cross trainer, to find myself staring at a cardboard cut-out of a girl on a brand new cross trainer," Leslie says.

"Obviously an advertisement for some new cross training machines they are about to get but pretty poor to have the ads up before the equipment actually arrives."

Sarah Hannant, an executive assistant, says similar sub-standard service led her to dump a long-term membership with one of the big chains.

"I remember arriving one day after work, rushing to get there 15 minutes early for the body step class, only to be told there were no passes available," Hannant says.

"I wasn't too bothered until I attempted to get a piece of cardio equipment and waited 20 minutes with no success. I ended up walking out disappointed and decided it was time to look elsewhere as this was becoming a regular occurrence.

"When I spoke to the customer service manager about this issue and that I was going to end my membership, she didn't do anything to attempt to keep me there, so I knew they were too over-sold to care about someone like me."

Leslie and Hannant are not alone. Thirty per cent of gym joiners drop their memberships in the first six to 12 months. Only 45 per cent stay beyond a year, according to figures from Fitness Australia.

Of the long stayers, only 21 per cent hang in for more than two years.

Gen Ys comprised about two-thirds of gym goers and are more mobile and capricious than their older counterparts, says the chief executive of Fitness Australia, Lauretta Stace.

Some short-termers are "seasonal" members – those who use the gym in winter and exercise outdoors in summer – while others are lured away by the low-cost, no-contract offers of the 24-hour chains.

There are now about 400 of these hole-in-the-wall outlets, which have cannibalised the full-service market, since the concept arrived in Australia five years ago.

Thirty per cent of 24/7 users are former clients of traditional gyms and the sector accounts for 80 per cent of the growth in the market since 2007, according to the managing director of Jetts, Adrian McFedries.

Greg Oliver, the chief executive of the Good Life chain, which has 62 clubs in Australia, believes unhappy clients such as Leslie and Hannant are in the minority.

He says gyms' high churn rates have more to do with people's external circumstances than dissatisfaction with what gyms offer.

"Life events get in the way and stop them coming – marriage, divorce, work and travel," Oliver says.

"The amount of people who come back after a hiatus is still pretty substantial . . . a lot of newcomers are returners who fell out of their routines."

While customers tend to notice the industry's focus on attracting newcomers – advertising, joining-up incentives and follow-up phone calls three months after you popped in for a quick look – chains invest significantly more in keeping existing patrons happy, Oliver says.